ISLAMABAD June 12: The government has fixed the price of seed cotton (phutti) grade III at Rs800 per 40 kg against the current year’s price of Rs780 per 40 kg and asked the Trading Corporation of Pakistan to maintain this price level through procurement.

Announcing this at a news conference on Wednesday, Commerce Minister Abdul Razak Dawood said that duty-free import and export cotton policy adopted last year would continue in the next year.

The seed cotton for which price has been fixed is required to be of minimum staple length of 1-1/32” and micronaire of 3.8 to 4.9 NCL.

The next year’s cotton yield target has been lowered to 10.1 million bales as against 10.9 million bales of the current year due to the drought conditions.

The TCP, though had to incur substantial losses in purchase of 0.250 million raw cotton bales this year by paying 12 cent per bale more to keep the local market prices stable, the minister said this role of the TCP would also be continued.

Explaining the role of TCP, he said the corporation was there to intervene whenever the local market prices fell below the official price and bought raw cotton for purpose of stabilizing prices.

He said the raw cotton export had dropped during current year to about 173,000 bales from the previous year’s 700,000 bales due to drastic decrease in the world market prices, which came down to 28 cent per pound from up to 70 cent of previous years.

This dropping, however, was encouraging in a sense as the value added exports of cotton products, including readymade garments, had registered 57 per cent increase projected for the current year, said the commerce minister.

The government expects a boom in value addition of raw cotton during the next fiscal due to the projected drop of some seven million bales of cotton in the international market.

The domestic consumption of cotton for the current year is projected at 10.5 million bales, showing about seven per cent increase with 1.3 million bales still available in the TCP stocks while another 0.6 million bales were with ginners expected to be consumed by the start of new crop. The textile mills consumption this year has reached new highs of 9.88 million bales as against 9.44 million bales of last year, the minister asserted.

The TCP would be having a stock of three million bales available for export by closing of the current harvesting season, Mr Dawood said, which he added would be one million bales more than the last year’s stock.

The commerce minister said the mills were consuming about 0.8 million bales per month and “we have a stock of three million bales available in the country to suffice them for three more months”. He said that cotton sowing in Balochistan had shown encouraging results and “we are intending to extend the same facilities to D.I. Khan in NWFP from next year.

Speaking on the occasion, secretary food and agriculture said the cotton sowing target this year was pitched below due to the drought effects — for Punjab it was 2.33 million hectare and 5.47 million hectare in Sindh.

He said the water shortage had hit sowing as Punjab had to sacrifice water for Sindh where its sowing was surpassed the target by some 12 per cent, while sowing in Punjab was in full swing.

He, however, claimed that the water reservoirs at Tarbela and Mangla indicators were very encouraging and there would be no shortage of water in the current season with the result per hectare yield in Punjab is projected at 576 kg as against 565 kg per hectare last year.